Court plea from Mango Markets exploiter

Avraham Eisenberg’s defense argued that their client shouldn’t pay back the $47 million he kept as a “bug bounty” after Mango DAO passed his proposal on October 20.

Fresh Mango on the green background

Eisenberg, who was arrested and detained in Puerto Rico in January on commodities fraud and market manipulation charges, is seeking to keep the funds he claims to have obtained as a result of a “highly profitable trading strategy.”

In October last year, Eisenberg manipulated the market to artificially inflate the price of the Mango DAO’s low-liquid MNGO token and then drained all liquidity from the marketplace, posting MNGO as collateral. When the token’s price returned to its pre-manipulation level, Mango Markets was left with a $114 million deficit.

“I believe all of our actions were legal open market actions, using the protocol as designed, even if the development team did not fully anticipate all the consequences of setting parameters the way they are,” Eisenberg tweeted.

Members of Mango DAO voted not to pursue any criminal investigations against Eisenberg in exchange for him returning $67 million to the community. However, in January Mango Labs, which is representing the DAO in court, sought to void the settlement, arguing that DAO voters agreed to it under duress.

“Mango Labs offers just one argument in favor of voiding the Settlement Agreement—'duress,'” Eisenberg’s attorneys wrote in a motion filed on February 15. “Mango Labs now claims that Mango Markets had ‘no choice’ but to vote in favor of the Settlement Agreement. Mango Labs provides zero evidence in support of this theory.”

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“In all likelihood, Mango Labs witnessed third parties bringing claims against Mr. Eisenberg (none of whom have sought preliminary injunctions) and crafted a scheme to get in on the action,” his legal team claims

Eisenberg also faces charges brought on by the Federal Bureau of Investigation and two pending lawsuits from the Securities and Exchange Commission(SEC) and the Commodity Futures Trading Commission (CFTC)